Database and cloud-computing giant Oracle (NYSE:ORCL) reported quarterly results Tuesday night, covering the fourth quarter of fiscal year 2018. Oracle exceeded Wall Street's estimates across the board, but share prices fell as much as 8% on Wednesday anyway. Besides soft earnings guidance for the next quarter, Oracle left analysts and investors shaken by a sudden change to its financial reporting framework.

Oracle's fourth quarter by the numbers

Metric

Q4 2018

Q4 2017

Year-Over-Year Change

Revenue

$11.3 billion

$10.9 billion

3.3%

Net income

$3.41 billion

$3.23 billion

5.5%

Adjusted earnings per diluted share

$0.99

$0.89

11%

Data source: Oracle.

These results compared favorably to analyst estimates, which had called for adjusted earnings of $0.94 per share on $11.2 billion in top-line revenues. Oracle's quarter also exceeded the top end of management's sales and earnings guidance ranges, and co-CEO Safra Katz called it "a terrific quarter."

Oracle shares surged 4% higher in after-hours trading, based on these solid figures. But the joyride ended during the earnings call, where guidance for the next quarter was discussed. In the first quarter of the 2019 fiscal year, Oracle should see adjusted earnings near $0.68 per share alongside roughly 2% of year-over-year sales growth in constant currencies. That's below the current analyst view, which calls for earnings of approximately $0.72 per share.

Cloudy cloud-computing numbers

Oracle is usually not shy about touting its successes in the cloud-computing market. This is a core component of the enterprise computing veteran's strategy these days, and management has been breaking cloud sales down into several detailed buckets in recent earnings reports. For example, the third-quarter update showed software-as-a-service sales rising 33% year over year, while platform-as-a-service and infrastructure-as-a-service hit slightly lower growth rates.

However, the fourth-quarter report showed none of that nuance in cloud-computing results. Instead, all types of cloud computing were baked into a single number along with caveats about how it can be difficult to separate software licenses used in cloud deployments from traditional on-premise installations.

In fact, Oracle recently made it even harder to make that distinction when it introduced the option to migrate existing licenses to Oracle's cloud-computing services.

"Customers are entering into large database contracts where some of those database licenses are to be deployed on-premise while other database licenses are used in the cloud," Katz explained. "Previously, all those licenses and its related support revenue would've been counted entirely as on-premise, which clearly it isn't."

Two young business people expressing confusion over the contents of their shared computer screen.

Is Oracle telling us everything we should know, here? Image source: Getty Images.

Is Oracle hiding something?

Several analyst firms wondered aloud whether Oracle might be trying to hide some sort of weakness in the cloud-computing story by making the results less transparent. The company is facing strong cloud-computing competition from the likes of Amazon.com (NASDAQ:AMZN) and Microsoft (NASDAQ:MSFT), and it wouldn't take much of a slip for Oracle to lose significant amounts of market share to these longtime rivals.

I suppose we'll know more in a couple of weeks, when Amazon and Microsoft report their own results for the corresponding period. Three months ago, both Microsoft and Amazon reported "accelerating" cloud-computing growth. Oracle isn't using that language here.

All told, Oracle's revenue and cash-flow growth has been stagnant over the last three years. Whether management is sweeping cloud-computing weakness under the rug or not, I see no real reason for investors to get excited about Oracle, even at a 20% discount to the stock's 52-week highs.

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Teresa Kersten is an employee of LinkedIn and is a member of The Motley Fool's board of directors. LinkedIn is owned by Microsoft. Anders Bylund owns shares of Amazon. The Motley Fool owns shares of and recommends Amazon. The Motley Fool owns shares of Oracle and has the following options: long January 2020 $30 calls on Oracle. The Motley Fool has a disclosure policy.